Wednesday, December 10, 2008

Caught in a Truth

The CEO of GM recently got caught telling the truth--that fuel efficiency standards are burying his company. Of course he said this in private--he would never tell that to congress since they can't handle the truth.*

Idiot congressmen, like the ones I talked about here, keep chanting, "Detroit is in trouble because stupid CEO's won't produce green cars." I have difficulty substituting the judgment of a numbskull whose only virtue is his ability to lie (a politician) for the judgment of someone whose paycheck, job, and career are on the line if he does not run a profitable company.

GM makes money domestically on big trucks and vans. They make money overseas, where gasoline costs $9/gallon, on small cars. But congress forces car companies to produce unprofitable cars domestically, which shackles their ability to compete with foreign car companies. Congress's current medicine for the car companies is more of the same. They have applied leeches to the patient until the patient is critical, and now they call for more leeches.

It may be the case that in two years gasoline will cost $6/gallon and the new green cars will be selling domestically. But if the auto companies are going to make it in the meantime, taxpayers will foot the bill.

Since congress will not free the auto companies, I would rather see congress kill the auto companies than turn them into another public utility. Put the auto companies out of their misery. Toyota can produce those big trucks and vans from now on.


*Just like he would never point out that at his rate of pay, the four days that it took him to drive to Washington and back to testify before congress cost his company over $120,000 (and that does not count the executives that accompanied him). Heck, the trip may have cost half a million, all told, which makes a private jet seem pretty cheap. Gorsh, these companies really do operate efficiently if you leave them alone.

No comments: